Protecting natural resources on your land – and investing in its natural capital – offers a huge opportunity for farms and estates to futureproof their businesses. In this blog, we provide examples of natural capital that may be present on your land that you could capitalise on. What is natural capital? Natural capital is any natural asset that brings value to people. Examples include biodiversity, air, soil, water, trees or assets with societal benefits, such as historic land. For a detailed description, see our blog: Natural Capital - what is it and how can it be measured on farmland? The concept of natural capital encourages farmers to attach financial value to the natural assets found on farmland, protecting and regenerating them for public or financial gain. Beyond the wider benefits to the environment and society, investing in natural capital can support farm business resilience and help increase efficiency. Woodland management Woodland management is a great starting point for natural capital as most farms contain hedgerows and trees. Woodland has the potential to filter and store greenhouse gas gases, support ecosystems and provide recreational benefits for people. Maintaining existing woodland or establishing new hedgerows and trees can make use of low-grade agricultural land or improve areas prone to flooding. Planting new trees can be used to generate carbon credits, which can be traded through government-backed or private markets. Examples include the Woodland Carbon Guarantee auctions (via the Woodland Carbon Code) and the England Woodland Creation Offer. However, woodland management needs careful planning; it is important to plant the right tree in the right place to avoid introducing pests and disease, or negatively affecting existing habitats. Water resource management Managing water sources is another proactive way to boost natural capital on farms and estates. Introducing sustainable drainage systems – such as buffer strips, ponds and silt traps – protects against flooding and shields water sources from pollutants, while providing habitats. Optimising nitrogen use can also help protect water courses from agricultural run-off and reduce fertiliser costs. To support with this, water companies have been paying farmers to invest in sustainable land use techniques to limit the need for removing pollutants from water courses. Planting physical barriers can also contribute to the Campaign for the Farmed Environmentor Natural England’s Environmental Stewardship Scheme. Improving soil health Looking after your soil is integral for crop production and healthy pastures. And like woodland, soil is recognised for its carbon storage properties. Some farmers are moving to sustainable land management techniques or regenerative practices that do not disturb the soil, such as minimum or no-till and direct drilling. This reduces their carbon footprint and improves soil structure. Boosting biodiversity, supporting pollinators If you have margins of land connecting fields, unused corners or plots, it could be beneficial to designate them for wildflowers. Wildflower areas create habitats for insects that pollinate crops or contribute to integrated pest management. Aligning wildflower margins with hedges and ditches can also add to water protection and allow animals to move around the landscape. Wildflower meadows may also provide additional opportunities to sell biodiversity credits to developers. LAND360 helps farmers to understand what natural assets they have, providing a sound evidence base to aid decision-making for sustainable land use and future revenue. 
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FAQs
Examples of Natural Capital across a Farm Business? ›
Examples include biodiversity, air, soil, water, trees or assets with societal benefits, such as historic land.
What is an example of a natural capital in a business? ›Natural capital is a reference to the inventory of natural resources held by companies, such as water, gold, natural gas, silver, or oil.
What are examples of capital in farming? ›Typical capital goods : o Farm buildings and infrastructures where production takes place o Machinery and equipment used in the production process o Animals used in farm operations (tilling, harvesting, etc.) o Animals breed and used to obtain livestock products (milk, wool, meat, skin, etc.)
What are the examples of natural capital services? ›Natural capital is the set of renewable and non-renewable natural resources of an ecosystem. These biological systems provide us with goods such as water, wood, construction materials, energy, medicines, and genetic resources.
What is an example of a natural resource capital? ›Natural capital refers to the planet's stocks of water, land, air, and renewable and non-renewable resources (such as plant and animal species, forests, and minerals). The term natural capital implies an extension of the economic notion of capital.
Which of these are examples of natural capital? ›Four examples of natural capital include water, sunlight, soil, and trees.
What are the two types of natural capital? ›Abiotic natural capital comprises subsoil assets (e.g. fossil fuels, minerals, metals) and abiotic flows (e.g. wind and solar energy). Biotic natural capital or ecosystem capital consists of ecosystems, which deliver a wide range of valuable services that are essential for human well-being.
What is the capital of a farm? ›The capital employed in farming is traditionally defined as the difference between the sale value of an operating farm and the sale value of the land in its natural state.
What are the capital expenses of a farm? ›Capital expenditures include tractors, trucks, autos, machinery, buildings, land improvements, and miscellaneous capital expenditures. Capital consumption represents the declining balance of capital stock or economic depreciation.
What are the two types of capital in agriculture? ›Capital used in agriculture can broadly be classified into two categories: (i) fixed capital and (ii) working capital.
What are the 4 major components of natural capital? ›
Natural capital consists of four categories of ecosystem services (MA, 2003) provided by marine and terrestrial ecosystems: (1) provisioning services, or tangible benefits, obtained from ecosystems such as water, food, timber, and minerals; (2) regulating services that regulate ecosystem processes such as climate, ...
What are natural capital areas? ›Natural capital is the world's stock of natural resources, which includes geology, soils, air, water and all living organisms. Some natural capital assets provide people with free goods and services, often called ecosystem services. All of these underpin our economy and society, and thus make human life possible.
Which is natural capital? ›Natural Capital can be defined as the world's stocks of natural assets which include geology, soil, air, water and all living things. It is from this Natural Capital that humans derive a wide range of services, often called ecosystem services, which make human life possible.
What is an example of a natural capital in business? ›Natural capital is any natural asset that brings value to people. Examples include biodiversity, air, soil, water, trees or assets with societal benefits, such as historic land.
What is an example of a natural resource in business? ›Oil, coal, natural gas, metals, stone and sand are natural resources. Other natural resources are air, sunlight, soil and water. Animals, birds, fish and plants are natural resources as well. Natural resources are used to make food, fuel and raw materials for the production of goods.
Is a tractor a capital resource? ›Answer and Explanation:
The tractor is a capital among factors of production. A tractor is a machine, and hence, assists in production based on technology. It is neither a natural resource nor labor.
What Are Examples of Capital? Any financial asset that is being used may be capital. The contents of a bank account, the proceeds of a sale of stock shares, or the proceeds of a bond issue all are examples. The proceeds of a business's current operations go onto its balance sheet as capital.
What is an example of a natural capital stock? ›Natural capital can be defined as the world's stocks of natural assets which include geology, soil, air, water and all living things. It is from this natural capital that humans derive a wide range of services, often called ecosystem services, which make human life possible.
What is an example of natural capital and income? ›Forests, mineral deposits, fisheries and fertile soil are some examples of natural capital. Air and water purification are just two of many services. Natural Income is the annual yield from such sources of natural capital - timber, ores, fish and plants, respectively, relative to the examples above.
What is the best definition of natural capital? ›Natural capital is the world's stock of natural resources, which includes geology, soils, air, water and all living organisms. Some natural capital assets provide people with free goods and services, often called ecosystem services.